Shares of Waystar dropped by approximately 3% in their Nasdaq debut on Friday following the pricing of their IPO within the expected range. The stock opened at $21 per share, slightly below the IPO price of $21.50. Waystar had initially estimated a price range of $20 to $23 per share in May. The shares closed at $20.70, down more than 3% on Friday.
The IPO market has been relatively quiet since late 2021 when concerns about a weakening economy emerged. As a result, technology companies have been hesitant to go public, with no digital health companies having a public exit in 2023, according to a report by Rock Health. However, recent market activity suggests that the broader venture-backed tech market could be showing signs of improvement, with companies like Reddit, Astera Labs, Rubrik, and Tempus AI going public this year.
Waystar, with an initial share price that gives it a market capitalization of around $3.5 billion, provides health-care payment and revenue cycle management tools, facilitating over 5 billion payment transactions annually. The company was formed in 2017 through the merger of health-care payment companies Navicure and ZirMed. Waystar’s CEO, Matt Hawkins, expressed excitement about being a public company and highlighted the benefits it brings in terms of awareness, credibility, capital structure enhancement, and potential investments in generative AI.
In the first quarter ending March 31, Waystar reported revenue of $224.8 million, a notable increase of 18% compared to the same period last year. However, the company also disclosed a net loss of $15.9 million for the quarter, up from $10.6 million a year earlier. Waystar intends to use the proceeds from the offering to pay off existing debt, with JPMorgan Chase, Goldman Sachs, and Barclays leading the offering.